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John Edwards donor tells of secret mission with Rielle Hunter

Edwards' defense is arguing that payments received were not campaign contributions. | AP Photo

Edwards is accused of conspiring to advance his presidential campaign by using nearly $1 million in off-the-books donations from Baron and wealthy heiress Rachel “Bunny” Mellon to pay Hunter’s expenses. Through his defense team, Edwards has denied knowing about Mellon’s payments but acknowledged having some idea that Baron was supporting Hunter.

Toben’s testimony suggests Edwards had fairly intimate knowledge of Young’s and Hunter’s actions as the false paternity scheme was hatched and as they fled to avoid the media.

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Edwards’s defense has also argued that regardless of how much the former senator knew, the payments didn’t amount to campaign contributions under federal law because the main purpose of hiding Hunter was to keep the affair from Edwards’s ailing wife, Elizabeth.

A former senior political adviser to John Edwards, Nick Baldick, took the witness stand earlier Monday and told jurors that he declined to manage Edwards’s 2008 presidential bid in part because of concerns that Edwards was involved in an extramarital affair with Hunter and had ignored aides’ advice to distance himself from her.

Testifying for the prosecution, Baldick described a meeting in a New York hotel room in October 2006 in which he and two other senior aides, Peter Scher and Harrison Hickman, confronted Edwards about suspicions he was carrying on an affair with Hunter, who’d been hired by Edwards-related committees to make behind-the-scenes videos about his pre-campaign travels.

“Mr. Edwards, to summarize, denied an affair,” Baldick said.

However, Baldick said he was blunt with Edwards about the futility of trying to seek the presidency if he was engaged in an ongoing extramarital affair with Hunter.

Baldick, who was campaign manager on Edwards’s 2004 bid, said that as Edwards’s official 2008 campaign committee was gearing up to launch he had a “very short phone conversation” with the candidate.

“I told him I didn’t think it made sense for me to run the next campaign,” Baldick said. He said he cited three reasons, including that Edwards “wasn’t really listening to him” about Hunter and about advisers’ concerns that her Web videos could actually damage his political prospects. The other two reasons, Baldick recalled, were that he was reluctant to be away from his children and that he and Elizabeth Edwards “didn’t necessarily get along.”

However, in May 2007, Baldick did launch Alliance for a New America, a 527 group that supported John Edwards’s presidential bid. The operative said he did so because he received indications the affair was over.

“I was under the impression Mrs. Edwards caught or found out about the affair,” Baldick said. “I made the crazy assumption it would stop.”

Regardless of the loutish behavior of Edwards, the law is on his side on this one. He gifted an unconditional gift which was not campaign related. Not Guilty. He can't have it both ways though: he may have a significant 30% gift tax problem.

If the money was a gift, Ms. Mellon was required to pay Federal Gift tax on the amount over $10,000. If the tax was paid, throw the case out. If it wasn't and she claims it was a gift, put her in jail for tax evasion. If she claims it was a political contribution and therefore exempt from gift tax, put Mr. Edwards in jail for using a campaign contribution for personal expenses. This ain't rocket science!

Who pays the gift tax? The donor is generally responsible for paying the gift tax. Under special arrangements the donee may agree to pay the tax instead.

What is considered a gift?Any transfer to an individual, either directly or indirectly, where full consideration (measured in money or money's worth) is not received in return.

What can be excluded from gifts?The general rule is that any gift is a taxable gift. However, there are many exceptions to this rule. Generally, the following gifts are not taxable gifts.

Gifts that are not more than the annual exclusion for the calendar year.

Tuition or medical expenses you pay for someone (the educational and medical exclusions).

Gifts to your spouse.

Gifts to a political organization for its use.

In addition to this, gifts to qualifying charities are deductible from the value of the gift(s) made.

May I deduct gifts on my income tax return?Making a gift or leaving your estate to your heirs does not ordinarily affect your federal income tax. You cannot deduct the value of gifts you make (other than gifts that are deductible charitable contributions). If you are not sure whether the gift tax or the estate tax applies to your situation, refer to Publication 950, Introduction to Estate and Gift Taxes.

How many annual exclusions are available?The annual exclusion applies to gifts to each donee. In other words, if you give each of your children $11,000 in 2002-2005, $12,000 in 2006-2008, and $13,000 on or after January 1, 2009, the annual exclusion applies to each gift.

Why are we wasting oxygen on this goober. He's a crook. As such, he should be rendered innocent and sent to Congress, or more appropriately, the Presidency. You deserve what you get defending this coagulated hunk of excrement.